Jakarta -US President Donald Trump instructed the Commerce Department to launch an investigation into whether imports of cars and trucks threaten US national security.
This move is considered to encourage the US to impose new tariffs on vehicles coming from outside the country.
“Core industries such as automobiles and automotive parts are critical to our strength as a nation,” Trump said in a statement on Wednesday (05/23/2010), as quoted by Bloomberg.
The intended investigations will be conducted under chapter 232 of the 1962 Trade Expansion Act, the same clause used by the US in applying the global tariffs for steel and aluminum imports. Chapter 232 authorizes the President of the United States to impose tariffs on imports that endanger national security.
In a statement, the US Commerce Department said that car manufacturers have long been a significant source of American technological innovation.
“This investigation will consider whether the decline in domestic automobiles and the production of automotive components is at risk of weakening the internal economy of the United States, including by potentially reducing everything from research and development to skilled work, and more advanced manufacturing processes such as electric motors and autonomous vehicles.” Department of Trade.
The move could also heat up tensions with the largest US trading partners, as well as add to a series of US threats that have shaken financial markets as well as disappointing traditional alliances.
Mexico is listed as the country with the largest number of passenger car exports to the US, followed by Canada, Japan, Germany, and South Korea, according to US data.
Industry watchers see this latest move as a US tactic to pressure Mexico and Canada to move quickly to agree to a reshuffle of the North American Free Trade Agreement. Rules for regional content on cars have become one of the most complicated issues in Nafta discussions.
According to government data, nearly a quarter of US auto sales are imports. The US has imposed a 2.5% duty on imported passenger cars and a 25% tariff on pickup trucks from non-party countries in free trade agreements.
Trump has previously signaled an important announcement to support the US auto manufacturing industry.
“There will be great news coming soon for our great ‘American Autoworkers’. After decades of losing work on other countries, you’ve been waiting for quite a while! “Writes Trump.
Since his presidential campaign in 2016, Trump has repeatedly stated that it will impose new tariffs on imported cars.